Sweet talking to ethnic customers : a field experiment on the links between entrepreneurial business planning, cultural sensitivity and sales growth

The purpose of this study was to test whether calculated inclusion of cultural sensitivity in a selected entrepreneurial business planning (EBP) process could increase sales growth in a test market and to explore the implications of a positive answer for the theory and practice of entrepreneurial business planning. Execution of a pretest-posttest control group experimental design measured and compared the implemented effectiveness of a planned entrepreneurial initiative based on cultural sensitivity. Though small in scale and limited in focus, the initiative qualified as an example of entrepreneurial business planning (EBP) and could be used to apply, test and extend aspects of the developing theory in this field of entrepreneurship research. Since the initiative was planned to overcome a culturally-defined impediment to business growth, it also offered opportunity to explore the specific importance of cultural variables in the context of EBP. A planned sales-promotion was offered to a control group (receiving information in English) and a treatment group (who received the information in the language of ethnic origin). The sixty subjects had been chosen at random from a population of route-trade retailers of defined ethnic origins (Greek, Lebanese and Chinese) and randomly assigned to control and treatment groups. Monthly sales averages of the promoted product were measured before and after treatment. A Chi Square test was used to evaluate the relative proportion of the control and treatment groups who accepted the promotional offer. A two sample t-test procedure and complementary non-parametric Mann-Whitney test were performed to compare the mean sales-performance change of the two groups. Analysis showed that there was a significant increase in mean sales when the planned entrepreneurial initiative was communicated in the relevant language of origin. The experimental results have specific practical relevance to revitalising the deteriorating route-trade segment of the Australian confectionery market through increasing the sales growth of wholesalers who are prepared to act entrepreneurially and include cultural sensitivity as an element in planning and implementation. By introducing cultural sensitivity as a necessary extension of a plan’s communications role, the results also have general theoretical implications for the developing paradigm of entrepreneurial business planning.